What Do New-Keynesian Phillips Curves Imply for Price-Level Targeting? / William Gavin, Robert Dittmar.

Format:

Datafile

Contributor:

Gavin, William.

Dittmar, Robert.

Inter-university Consortium for Political and Social Research.

Series:

ICPSR (Series) ; 1221.

ICPSR ; 1221

Language:

English

Genre:

Academic theses.

Physical Description:

1 online resource.

Place of Publication:

Ann Arbor, Mich. : Inter-university Consortium for Political and Social Research [distributor], 2000.

System Details:

Mode of access: World Wide Web.

data file

Summary:

This article extends the analysis of price-level targeting to a model including the New-Keynesian Phillips Curve. The authors examine inflation-output variability tradeoffs implied by optimal inflation and price-level rules. In previous work with the Neoclassical Phillips Curve, the authors found that the choice between inflation targeting and price-level targeting depended on the amount of persistence in the output gap. That is, if the output gap was not too persistent, or if lagged output did not enter the aggregate supply function, then inflation targets were preferred to price-level targets. When one starts with a New-Keynesian Phillips Curve, the amount of persistence in the output gap still affects the relative placement of the inflation-output variability tradeoff. But, contrary to the Neoclassical case, even where the persistence of the output gap in the aggregate supply function is small or nonexistent, the price-level targeting regime still results in a more favorable tradeoff between output and inflation variability than does an inflation-targeting regime.... Cf.: http://dx.doi.org/10.3886/ICPSR01221

Notes:

Title from ICPSR DDI metadata of 2004-10-30.

OCLC:

61145892

Access Restriction:

Restricted for use by site license.